Online ad revenue overtakes TV for first time in US

Apr 11, 2014 | Mobile, Online advertising, Online video, Search engine marketing, Social media, USA

US online ad revenues hit a record $42.8bn in 2013 billion, exceeding broadcast TV advertising ($40.1bn) for the first time, according to new data from the IAB. View the IAB webinar here: The online revenues, which includes mobile ads, rose 17% on the previous year’s total of $36.6bn. Mobile saw triple-digit-growth, hitting $7.1bn for the […]

US online ad revenues hit a record $42.8bn in 2013 billion, exceeding broadcast TV advertising ($40.1bn) for the first time, according to new data from the IAB.
View the IAB webinar here:


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The online revenues, which includes mobile ads, rose 17% on the previous year’s total of $36.6bn.
Mobile saw triple-digit-growth, hitting $7.1bn for the year, and accounting for 17% of 2013 revenues. Digital video saw $2.8 billion for the year, up 19% from the previous year.
Meanwhile, Search revenues were $18.4 billion in 2013, up 9%. Display ad revenue for the year was $12.8 billion, up 7%.
The IAB report, prepared by Price Waterhouse Coppers US, also reveals that fourth quarter revenues for 2013 came in at $12.1 billion, an increase of 17 percent from the $10.3 billion brought in during the same quarter in 2012. In addition, this total represents an uptick of 14 percent from 2013’s third quarter revenues at $10.6 billion.
Key highlights include:
• For the third year in a row, mobile achieved triple-digit growth year-over-year, rising to $7.1 billion during full year 2013, a 110 percent boost from the prior year total of $3.4 billion. Mobile accounted for 17 percent of 2013 revenues, whereas it was 9 percent of revenues in 2012.
• Digital video, a component of display-related advertising, brought in $2.8 billion in full year 2013, up 19 percent over revenues of $2.3 billion in 2012. As a result, it also increased its share to become the fourth largest format, directly behind mobile.
• Search revenues totalled $18.4 billion in 2013, up 9 percent from 2012, when search totalled $16.9 billion.
• Display-related advertising revenues in 2013 totalled $12.8 billion or 30 percent of the year’s revenues, a rise of 7 percent over $12 billion in 2012.
• Retail advertisers continue to represent the largest category of internet ad spending, responsible for 21 percent in 2013, followed by financial services and closely trailed by automotive which account for 13 and 12 percent of the year’s revenues respectively.
“The news that interactive has outperformed broadcast television should come as no surprise,” said Randall Rothenberg, President and CEO, IAB. “It speaks to the power that digital screens have in reaching and engaging audiences. In that same vein, the staggering growth of mobile is clearly a direct response to how smaller digital screens play an integral role in consumers’ lives throughout the day, as well as their critical importance to cross-screen experiences.”
“Our survey confirms that we are fully in transition to the post-desktop era,” said David Silverman, Partner, PwC U.S. “Triple digit advertising revenue growth from mobile devices contrasted the more tepid 8 percent growth from traditional computer screens. This is simply a reflection of the change in how and where consumers are viewing their information—on the go!”
“Digital marketing generates large reach and many possibilities to create impact across consumers’ purchase consideration processes, both critically important to advertisers as they seek marketing investments that have value ” said Sherrill Mane, Senior Vice President, Research, Analytics, and Measurement, IAB.
Here are the results from the full year in comparison with last year’s numbers:
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Here’s a breakdown of the key online advertising formats in 2013:
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IAB sponsors the IAB Internet Advertising Revenue Report, which is conducted independently by the New Media Group of PwC. The results are considered the most accurate measurement of interactive advertising revenues because the data is compiled directly from information supplied by companies selling advertisements on the internet.
The survey includes data concerning online advertising revenues from Web sites, commercial online services, free email providers, and all other companies selling online advertising. The full report is issued twice yearly for full and half-year data, and top-line quarterly estimates are issued for the first and third quarters. PwC does not audit the information and provides no opinion or other form of assurance with respect to the information.
A copy of the full report is available at: iab.net/AdRevenueReport.

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